The New Coney Island - Brooklyn's Times Square by the Sea

Tuesday, September 2, 2014

Overseas Buyers Bidding up Brooklyn

Crains excerpt 

The borough is seeing the lion's share of a record $600 million-plus in acquisitions in the outer boroughs in the first half.

Earlier this year, four besuited Japanese men representing Sumitomo Corp., whose holdings stretch from banking to automaking, paid a call on Adam Hess, a Brooklyn-based sales broker. They told him the Tokyo-based company wanted to add a new type of asset to its portfolio—Brooklyn real estate.

So do many other overseas-based property investors, who are increasingly bypassing Manhattan—the preferred landing strip for alien invasions of the past—in favor of jumping straight into the market in now world-famous Brooklyn. Through the first half of the year, foreign groups have shelled out more than $600 million for real estate in the city's outer boroughs, the most ever invested from abroad, with the lion's share of it gushing into deals in Brooklyn, according to data from Real Capital Analytics.

The biggest of those investments by far came in June when the Chinese firm Greenland Holdings bought a majority stake in the massive residential development planned for the 22-acre Atlantic Yards, which Greenland last month rechristened Pacific Park.

Many others have also swooped in this year. U.K.-based Ennismore Capital recently snapped up a nearly 40,000-square-foot development site in Williamsburg for its Hoxton hotel brand. Another British investment firm, Quadrum Global, spent $100 million acquiring two residential development sites: one in Greenpoint and one just over the border in Long Island City, Queens.

Real estate experts say that more deals from overseas buyers are on the way. A large, roughly $200 million development site on the waterfront in Williamsburg just south of Schaefer Landing that can accommodate 800,000 square feet of residential space, for instance, has attracted several foreign groups. Nearby, along the East River waterfront, Richard Mack, chief executive of Mack Real Estate Group, is courting offers from foreign investment funds to partner with him in a separate $200 million acquisition of a development, where he is planning to build rental apartments.

"Everyone wants to be in Brooklyn now, and the same is true with foreign buyers," Mr. Mack said.

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